Groh and Jackson Are Partners

Multiple Choice

Groh and Jackson are partners.Groh's capital balance in the partnership is $64,000 and Jackson's capital balance is $61,000.Groh and Jackson have agreed to share equally in income or loss.Groh and Jackson agree to accept Block with a 25% interest.Block will invest $35,000 in the partnership.The capital account balances after admission of Block are:

A) Block $35,000,Groh $64,000,and Jackson $61,000.
B) Block $35,000,Groh $66,500,and Jackson $63,500.
C) Block $40,000,Groh $64,000,and Jackson $61,000.
D) Block $40,000,Groh $61,500,and Jackson $58,500.
E) Block $40,000,Groh $66,500,and Jackson $63,500.